E-commerce major Flipkart is implementing performance-based job cuts which will decrease team size by 5-7 per cent. Reportedly, the cuts will be based on annual performance reviews and will be completed by March-April 2024. A major player in the Indian e-commerce industry, the Walmart-owned company is set to undergo a restructuring phase to optimise its resources and operations. The company, excluding its fashion portal Myntra, currently sustains a workforce of 22,000 individuals.
This is not the first instance of Flipkart implementing performance-based job cuts. The report added that similar exercises have been in practice over the last two years.
Additionally, as part of cost-control measures, Flipkart has refrained from fresh hiring in the past year. The company is finalising a US $ 1 billion financing round, including contributions from Walmart and other investors.
Sources signal that Flipkart is gearing up to enhance the utilisation of its resources across existing and new business ventures. Discussions and decisions regarding the restructuring plans and the 2024 roadmap are slated for a meeting involving senior executives in the coming month.
Despite the ongoing restructuring, Flipkart maintains its decision to defer its initial public offering until 2024, the sources said. Previous plans for an IPO in 2022-23 have been temporarily halted.
Flipkart’s strategic ventures, including its recent acquisition of Cleartrip, part-owned by the Adani Group, have achieved a gross merchandise value (GMV) of approximately US $ 1.5-1.7 billion. The company is eyeing further investments in its hotel business, expanding Cleartrip’s services beyond airline bookings. They added that while securing US $ 600 million in fresh capital from parent company Walmart as part of the ongoing US $ 1 billion round, Flipkart’s senior management is actively seeking ways to reduce expenses across different categories.
Various major Indian internet companies, buoyed by high demand for technology services during the pandemic-induced surge in 2021, are now rationalising their teams. Industry experts foresee similar actions from other venture-funded Indian organisations throughout 2024.
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